Which of the Following Would Not Be Included in Compensation

question 28

Multiple Choice

Which of the following would not be included in compensation of employees when calculating GDP using the income approach?

• A)The wage the owner of a small business pays themselves.
• B)Canada Pension Plan (CPP)premiums paid by an employer.
• C)Wages and salaries paid to workers.
• D)The cost of a health insurance plan that a corporation buys for its employees.
• E)The cost of payroll taxes.

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Definitions:

Relevant Costs

Costs directly related to a specific decision, which will change as a result of that decision.

Average Cost

The total cost of production divided by the number of goods produced, representing the cost per unit of output.

Marginal Cost

The financial outlay for creating one further unit of a good or service.

Extent Decisions

Decisions related to the scale or scope of an operation or project, often involving considerations of expansion or reduction.